BUA FOODS PLC – Broad-Based Revenue Expansion & Margin Strength Drive Robust 9M 2025 Earnings Growth

Executive Summary

BUA Foods Plc delivered a strong financial performance for the nine months ended September 30, 2025, supported by solid topline expansion, resilient demand across food categories, and effective pricing strategies. Despite higher operating costs amid inflationary pressures and sustained distribution expense outlays, the Group reported double-digit earnings growth, reflecting continued operational efficiency and scale advantage in Nigeria’s fast-moving consumer goods (FMCG) sector.

Turnover expanded 31.0% YoY to ₦1.42 trillion (9M’24: ₦1.08 trillion), driven by increased volume across sugar, bakery flour, and pasta segments, alongside favorable price adjustments. Gross profit rose 56.0% YoY to ₦520.6 billion, while Profit After Tax surged 101.3% YoY to ₦405.3 billion, supported by improved business mix and effective cost control.

Despite rising selling and distribution expenses, EBITDA margins remained strong, highlighting the Group’s superior production capacity, logistics integration, and economies of scale. The balance sheet remained sound, underpinned by strong retained earnings and disciplined leverage management.

BUA Foods continues to benefit from robust consumer food demand, import substitution dynamics, and market leadership across core staple food segments.

Financial Highlights – Statement of Profit or Loss

₦’000 9M 2025 9M 2024 YoY Change

Turnover 1,420,734,893 1,082,454,505 +31.1%

Cost of Sales (900,087,077) (731,853,712) +23.0%

Gross Profit 520,647,816 350,600,793 +48.5%

Admin Expenses (30,433,880) (25,157,379) +21.0%

Selling & Distribution (53,219,539) (43,325,992) +22.8%

Other Income 587,400 3,094,397 -81.0%

Operating Profit 437,581,798 285,211,819 +53.4%

Finance Income 7,048,971 7,048,971 —

Finance Costs (11,912,409) (11,341,312) +5.0%

Profit Before Tax 432,579,212 280,780,330 +54.0%

Tax Expense (27,307,896) (14,267,442) +91.3%

Profit After Tax 405,271,316 201,389,141 +101.3%

EPS (₦)** 22.52 11.19 +101.3%

Revenue & Operating Dynamics

• Strong revenue growth driven by volume expansion and pricing resilience
• Efficient plant utilization and scale advantage supported gross margin improvement
• Higher distribution cost reflects ongoing network expansion and inflation-adjusted logistics expenses

Key drivers:

• Consistent demand for essential food staples
• Increased domestic capacity utilization and backward integration focus
• Improved export volumes supporting FX earnings

Profitability & Margins

• Operating profit margin strengthened on scale benefit
• Finance cost remained stable despite tighter interest environment
• Tax charge reflects higher earnings base

Margin traction underpinned by:

• Production efficiency
• Cost optimization in manufacturing operations
• Price-volume synergy

Balance Sheet Overview

₦’000 Sep 2025 Dec 2024 Change

Total Assets 1,242,527,662 1,095,504,241 +13.4%

Total Liabilities 642,199,700 666,447,596 -3.6%

Equity 600,327,961 429,056,645 +39.9%

Key Balance Sheet Insights

• Strong equity accretion driven by higher retained earnings
• Borrowings declined, improving leverage profile
• Robust liquidity position with improved working-capital discipline

Key Metrics & Indicators

Metric 9M 2025 Trend

Revenue Growth +31.1%

PAT Growth +101.3%

Gross Margin Expansion

Strategic Insights

Strengths

• Dominant market share in key food segments
• Strong operational cash generation capability
• Economies of scale and backward integration
• Solid pricing power

Weaknesses

• Rising operating expenses from network expansion
• Sensitivity to commodity input inflation
• Decline in other income due to prior one-off items

Outlook

BUA Foods is positioned to sustain earnings momentum driven by:

• Continued consumption of staple foods
• Capacity expansion in sugar and flour operations
• Stabilizing FX environment supporting cost planning
• Focus on distribution enhancements and export penetration

Key priorities going forward

• Maintain margin discipline amid inflationary pressures
• Reduce finance costs through further deleveraging
• Strengthen export channel and FX earnings stream

Analyst View

“BUA Foods delivered another strong period of earnings resilience, supported by operating scale, brand strength, and strategic cost discipline. With sustained volume growth and capacity investment, the Group remains well-positioned to expand market leadership and drive long-term value creation. Execution on distribution expansion and cost optimization will be critical to maintain margin strength in an inflationary environment.”

Conclusion

BUA Foods achieved a robust financial performance in 9M 2025, underpinned by strong demand fundamentals, operating leverage, and disciplined execution. With a strengthened balance sheet, solid profitability, and expanding production footprint, the Group is well-placed for continued growth and shareholder value enhancement.